Sony reportedly in talks to sell PC ops, shares jump

The Nikkei reports Sony (SNE+5.1%) is in talks to sell its Vaio PC unit, and is looking to receive ¥40B-¥50B ($394M-$492M).

The report follows one over the weekend stating Lenovo (LNVGY), which last month struck deals to buy Motorola Mobility and IBM's x86 server unit, is in talks to acquire Sony's PC ops. Sony called the report inaccurate, but admitted it's exploring options for the business.

Sony shares have shot higher on the Nikkei's report. Investors like the idea of unloading a loss-generating unit that has struggled to deal with declining PC sales and tough competition from Lenovo, H-P, and others. The company's FQ3 report is due on Thursday morning.

Thanks to both the Sony report and a massive equity selloff, Lenovo shares are down 16% in Hong Kong over the last two days.

For Lenovo, it has to be all about scale. They see themselves as a cost leader, and are relatively unique in that they do much of their assembly work in-house (instead of outsourcing to ODMs).

If they think Sony can give them additional scale while also providing some talent in other areas (engineering, design, etc.), maybe it's worth it for them at the right price. That said, investors clearly have their concerns.

the problem with computer hardware industry is that the low end does everything most would ever want to do with a computer except high end gaming. the upgrades are less meaningful since the low hanging fruit has been picked.

when i was in the computer business, we went from 286's to 386's to 486's, etc... all upgrades had huge and meaningful performance jumps. now i wouldn't know if a computer was new or 3 years old by using it for what i use a computer for (typing, surfing).

until there is a real revolution in the basic way people use computers, i expect this to be a crowded market with ever lower margins and at best flat demand.

not saying sony won't sell it, but i would expect that the price would be in the low end of the range (around 390 million) ... if it's not lower. i look for lenovo to sidestep this deal.

The problem isn't with Windows, there is more then enough new functionality in Windows 8 as opposed to 7. However, nobody is building anything to take advantage of the new functionality. And why? Because the consumers have gotten, quite frankly, dumber. There is no need for cutting edge computers because people have stopped using them to learn, empower themselves and develop. They have become toys to keep kids out of their parents hair.